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New tax agency in Honduras is created

On February, the execution of the project based on the creation of a new Revenue Administration Service (SAR by its acronym in Spanish) in Honduras began. The offices of the Executive Revenue Direction (DEI by its acronym in Spanish) were temporarily closed on March 16, 2016, in order to allow the creation of the new Tax Administrator, arguing an improvement in the tax collection policy.

This project was advised by the Inter-American Development Bank (IDB) and the Inter-American Center of Tax Administrations (CIAT by its acronym in Spanish). The establishment of the SAR draws from the Ecuadorian model. Diagnosis held by the IDB, CIAT and Ecuador reveals that the main problem of the tax authorities of Honduras is insufficient revenue due to the ineffectiveness of the tax processes (registration, declaration, invoicing, auditing and collection), low quality information, which is not reliable to supervise and collect taxes, and low professionalism of staff.

With the above mentioned changes, a new Tax Code that goes hand in hand with the Revenue Administration Service is also expected to improve tax collection.

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